Nick Snow
Washington Editor
Three days of blatant political posturing by the Obama administration and several US Senate Democrats left Charles T. Drevna wondering how much more time must pass before those politicians are ready to have an adult conversation with the oil and gas industry.
He spoke with OGJ on May 16 after the US Senate Finance Committee's May 12 hearing where members sternly lectured the chief executives of the nation's five biggest integrated oil companies for defending tax deductions other businesses routinely take, and US President Barack Obama's May 14 weekly radio address in which he simultaneously called for more domestic exploration and production and repeal of tax deductions which encourage it.
Drevna, who is president of the National Petrochemical & Refiners Association, is a Washington veteran who's seen this kind of political posturing before. He doesn't find it the least bit amusing when the US simultaneously needs to improve its energy security, stimulate a still-fragile economic recovery by providing more jobs, and confront a serious federal budget deficit.
"I believe the hostility has escalated over the year," he said. "When you're looking at the nation's financial deficit, with 8-9% official unemployment that's probably closer to 15-16%, it's easier to target the oil and gas industry than confront the problems. It's sheer demagoguery at the worst."
Instead of having an adult conversation about where the US is going to go economically, how it can be made more energy secure, and how its vast oil and gas resources can be developed in an environmentally sound manner, Drevna said many politicians find it easier to target the industry, or parts of it, for higher taxes and call it deficit reduction instead.
'Beyond the pale'
He maintained that the five chief executives at the Senate Finance Committee hearing did a good job not only of defending the tax provisions. "Unfortunately, they also had to defend an industry that provides 9.2 million jobs, pays untold amounts of state and local taxes, and provides important products to the nation's consumers," Drevna said. "Why certain members of Congress are vilifying that is beyond the pale."
Drevna said he believes oil markets are on a fulcrum where any kind of geopolitical occurrence could make prices even more volatile. "On the other hand, if we got serious as a nation about the tax code and opening up our vast oil and gas resources and becoming more energy secure, I think it would send a more positive message to the marketplace," he suggested
The benefits wouldn't be immediate, but they'd be substantial, Drevna said. It will require adult conversations that look beyond the 2012 elections, he added.
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